Ahead of planned overhaul of retirement payments for elderly Canadians, MPs appear to back the need to reform their own pension plan

Government House leader Peter Van Loan speaks to reporters in the Foyer of the House of Commons on Parliament Hill in Ottawa on Monday, January 30.

By:Allan WoodsOttawa Bureau, Published on Mon Jan 30 2012

OTTAWA—Federal politicians appear united in their resolve to cut their glitzy pension plan at the same time as Ottawa debates overhauling seniors’ payments.

The only question is how best to proceed and how deep the cuts will be to a plan that provides a member of Parliament with only six years of service an annual payment of at least $40,000 by the age of 55.

And like all questions about how politicians use taxpayer dollars for expenses, salaries or for retirement, most MPs don’t want to talk about it.

“If there are (proposed) changes to it, then show us and then we’ll talk, but other than that I don’t really know what we’re talking about other than a trial balloon,” said New Democrat Charlie Angus.

Public Safety Minister Vic Toews was even more evasive.

“That’s something for the members to determine, I guess,” he said.

What’s clear is that as the government moves forward with proposed changes to the retirement payments to millions of elderly Canadians, they can’t avoid taking a hit in their own pensions.

The Conservatives have been vague about how they intend to proceed. Government House Leader Peter Van Loan suggested he was misunderstood when he said the matter would be referred to the secretive Board of Internal Economy, an all-party committee that rules over House of Commons spending.

It turns out the axe will fall to the budget cutter-in-chief, Treasury Board President Tony Clement.

An aide to the minister would only say Monday afternoon that “all options will be considered as we work to reduce and eliminate the federal deficit.”

But the New Democrats and Liberals have already said they are willing to get involved in making the difficult decisions.

“Mr. Harper, if he has some particular proposals that he wants to put forward, he can put them forward,” said Liberal leader Bob Rae. “Obviously having an outside body review it as well would be great but I’m quite happy to see a review of pensions.”

The NDP says any MP pension review should be sent off to an independent agency to avoid the appearance of a conflict of interest that would occur if politicians are seen adjudicating over their retirement payment plans.

“We’re really in an untenable situation,” said NDP MP Pat Martin. “We’re not being coy by saying it should be examined, reviewed and decided by an outside third party. I just can’t say anything about it without getting into trouble.”

The talk comes after several damning reports suggesting their retirement savings plans are overly generous and inflated by taxpayer dollars. The Canadian Taxpayers’ Federation said in a study last week that while the economic downturn hit other private and public pension funds hard, the MP pension fund continued to grow.

That’s largely thanks to Canadians, which the group says pay $23.30 into the pension fund for every $1 that federal politicians put forward from their salaries.

The latest government report on the pension fund showed the average annual allowance was $53,586 for former MPs. One-hundred-and-seventeen former MPs and Senators received more than $70,000 annually.

The taxpayer’s advocacy group says that MPs must deal with the largesse in their own pensions before it has the moral authority to reduce retirement payments for Canadians and federal civil servants. One proposed solution would be to enroll politicians in the same pension fund that handles retirement payments for public servants.

More on thestar.com

We value respectful and thoughtful discussion. Readers are encouraged to flag comments that fail to meet the standards outlined in our
Community Code of Conduct.
For further information, including our legal guidelines, please see our full website
Terms and Conditions.